EURRON and public sector wages

The higher salaries for public workers theme is still on the agenda in Romania. I have been very critical of this political decision (mostly in Romanian so far) but until now to no avail.
Maybe this will help.

The two graphs below show what seems to be a bizarre coincidence. The EURRON exchange rate does not like higher wages in the public sector.

The first graph shows the EURRON reaction after the Romanian parliament approved 50% higher wages for teachers. The second graph shows the EURRON reaction after the ruling coalition approved higher wages in the public sector with 15% starting June 2012. Are the markets or the NBR (wink) telling us something? I think so and we should better listen to them.


14 thoughts on “EURRON and public sector wages

    1. @Alex
      No, I just think some subjects could be of interest to foreign investors also. I will keep the Romanian language for posts related to domestic policy. I have few surprises for this week end.

      1. @Florin
        “Is this a mutiny to shift this to an all Romanian blog ?”
        I don’t have all the traffic data to reach a conclusion. It’s your blog.

        Most Romanians don’t know how to write well in English. So if you want to spread your ideas to a large Romanian audience, you will be better off writing in Romanian.

        It’s also faster to write in Romanian than in English. I personally don’t have a problem with both languages.

        If I would be in your place: yes, I would shift to an all Romanian blog. And I will also get a premium wordpress theme.

      2. @Florin
        I have something coming up and I hope to solve these issues.
        To be honest it is easier for me to write in English. In the same time, I started the blog mostly to structure my thoughts. I never thought about the audience I just thought to deliver a good product that I could use further in my research work. Yes, sometimes I am frustrated by the level of the public debate about economic issues and I lash out here. But I know that my blog has no influence and I calm down pretty fast. πŸ™‚

        For now it will remain bilingual with public policy posts in Romanian while more market oriented ones will be in English. Thanks for the suggestions though.

      3. @Florin
        When you want to sell something, even an idea, you need to start with your audience. Then you need to identify what they need, want or desire. And give it to them.

        If you want to bring new info to them, you need to start from their point of view, so they can understand you. And then change their views gradually one post at the time.

  1. Jeffrey from IMF laughed out loud when he heard about the upcoming 15% increase in public wages. He said that something like that is neither possible nor recommended.

    Based on your article, it seems that NBR already knows how they will get the money: by printing them. They will debase the RON and make it even weaker against the EUR. And this will show up in the exchange rate.

  2. That was me trying to give you an opportunity to say more on public sector reforms. And i do this because i also think +16% is something we should avoid. Btw, i’ve seen you on tv and you couldn’t even speak too much on that show, they did everything they could to shut you up and make fun on what you said. So, no matter what language you’re using: Keep Talking !

  3. “Yes, sometimes I am frustrated by the level of the public debate about economic issues and I lash out here. ”

    This is wrong. All public debate is low level and will keep being like this for very long time unfortunately.

    Good luck with the new blog ! πŸ™‚ And i think it’s better that way. You’re gonna like it more. Always better to own something. πŸ˜€

  4. Habar nu am, era la tvr info cred, parca o saptamina in urma, pe la 22:00. Mai simplu spus emisiunea in care dna moderator se tot ruga de doi oameni: hai sa-l lasam si pe dnul Citu sa vorbeasca. Si invitati mai erau dl Isar si dl Voinescu. Scuze daca am gresit vreun nume. πŸ™‚

  5. Florin nu putea sa vorbeasca de colegul lui Isar nu ca n-ar fi fost lasat de portocalii sau de madame Lupea. Nici Voinescu nu prea avea loc de Isar. Si asa se intampla si la Soviani cand era cu Isar. Florin nu ducea o fraza pana la capat πŸ˜€

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